Law and regulation

Audit / FRC to be disbanded as government green lights new audit regulator

The Financial Reporting Council (FRC) will be closed and replaced with a new audit regulator following criticism of their effectiveness of the existing organisation following a string of audit scandals at major listed companies

Accounting / Essentials: Brexit changes to company law for accountants

The government is passing substantive legislative changes to Companies Act 2006 (CA 2006) via statutory instrument and has issued guidance letters for accountants and auditors with advice on how to operate cross-border in the event of a no deal Brexit. James Waller CA, technical writer at Croner-i Tax and Accounting, explains the key considerations

Audit / FRC consults on tougher going concern rules

The Financial Reporting Council (FRC) is consulting on plans to revise the International Standard on Auditing (ISA) (UK) 570 Going Concern, which will mean requirements for UK auditors will be significantly stronger than those required by international standards

Audit / Audit updates: March 2019

In this month’s round-up of audit news, FRC extends probe into Carillion audit, no deal Brexit advice for auditors, Vodafone drops PwC in swap to EY, BDO picks up £200k Halfords audit from KPMG

Audit / ISA (UK) 540 (Revised): scalability and audit of accounting estimates

The revised international auditing standard, ISA (UK) 540 (Revised) Auditing Accounting Estimates and Related Disclosures, attempts to improve scalability issues and treatment of accounting estimates as more complex forward analysis becomes available for financial reporters. Michelle Roberts CA, specialist audit writer at Croner-i Tax and Accounting, considers the judgment issues for auditors

Audit / Deloitte Japan fined $2m over independence failings

Deloitte’s firm in Japan is to pay $2m (£1.56m) to settle charges from the Securities and Exchange Commission (SEC) that it issued audit reports for a client at a time when dozens of its employees maintained bank accounts with the client’s subsidiary, in violation of the regulator’s audit independence rules

Audit / The future of auditing: a cluttered horizon

Katharine Bagshaw FCA examines the future of auditing in light of a raft of UK investigations into quality, purpose and independence, the Monitoring Group's proposals to overhaul the international audit standard setters, and attempts to modernise auditing standards in an age of cross-border, digital multinational businesses, not to mention the audit needs of smaller entities

Audit / £21m damages bill for Grant Thornton’s ‘flagrant’ audit failures

Grant Thornton has been ordered to pay an audit firm record of £21m in damages to former client AssetCo after a High Court judge branded its auditing of the company, which nearly collapsed as a result of an accounting scandal, to be a ‘flagrant breach of professional standards’, exhibiting failures ‘of the utmost gravity’

Audit / Audit updates: February 2019

In this month’s roundup of audit news, MPs probe Big Four and mid-tier firm heads about sustainability of audit, FRC consults on tougher stewardship code and changes to third country auditor fees due to Brexit, Carillion audit investigation to continue well into 2019, audit wins at SSE and ICG, while Aston Martin puts audit out to tender

Audit / PCAOB faults half of KPMG US audits inspected

The Public Company Accounting Oversight Board (PCAOB) identified deficiencies in half of the audits it inspected at KPMG’s US firm in 2017, with concerns that there might not have sufficient audit evidence to support the firm’s opinion in some instances

Audit / FRC Carillion probe to continue ‘well into 2019’

The Financial Reporting Council’s (FRC) investigation into Carillion is set to continue for much of this year but will be completed ‘promptly and thoroughly’, the regulator has said in an update on its examination of KPMG’s auditing and the conduct of two former finance directors of the failed outsourcer

Audit / KPMG suspends Carillion audit partner

KPMG has suspended Peter Meehan, the audit partner for failed outsourcing company Carillion, and three other members of staff after discovering issues with documentation provided to the Financial Reporting Council’s (FRC’s) audit quality review (AQR) of the company in 2017

Audit / BEIS committee warned over audit reform proposals

Both academics and business experts raised concerns of ‘unintended consequences’ of audit reforms to the business, energy and industrial strategy (BEIS) committee, with broad disagreement over whether the changes should be led by government or business, reports James Bunney

Audit / Calls for full scrutiny of EU banking audits

The European Court of Auditors (ECA) wants EU legislators to intervene and ensure the European Central Bank (ECB) allows full access to documents for audits related to banking supervision, arguing that the current position prevents them from carrying out their work properly

Audit / FRC consults on third country auditors' fees to prepare for Brexit

The Financial Reporting Council (FRC) has issued a four-week consultation on the fee structure for third country auditors (TCA) in the event of a no-deal Brexit, although it has indicated that the current fee structure is unlikely to change
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